Two highly respected executives have resigned from San Francisco proxy-advisory firm Glass Lewis & Co. amid allegations that its Chinese parent company may have withheld unfavorable information when it went public in the United States in March.

Lynn Turner, managing director of research, and Jonathan Weil, managing director and editor of financial research, stepped down from Glass Lewis within the past week. Weil wrote a resignation letter implying that parent company Xinhua Finance may be failing to live up to the corporate-governance standards that Glass Lewis helps institutional shareholders navigate.

Xinhua Finance Media, a financial-news media company based in Shanghai, had an initial public offering on the Nasdaq in March. Xinhua had owned a stake in Glass Lewis since the summer and bought the rest of the company this year.

Barron's reported this week that Xinhua's IPO prospectus failed to disclose that its chief financial officer, Shelly Singhal, had business dealings that were under investigation by the National Association of Securities Dealers for alleged violation of Securities and Exchange Commission rules. Singhal resigned from Xinhua on Saturday.

"I am uncomfortable with and deeply disturbed by the conduct, background and activities of our new parent company Xinhua Finance Ltd., its senior management, and its directors," Weil's resignation letter said, according to press reports. "To protect my reputation, I no longer can be associated with Glass Lewis or Xinhua Finance."

Weil, a former Wall Street Journal reporter who is credited with breaking the Enron story, could not be reached for comment. Turner, a former top accountant at the SEC, did not return calls.

Xinhua and Glass Lewis did not respond to requests for comment.

Glass Lewis said in a statement that it is forming an advisory committee to ensure that its research is objective and independent.

Xinhua Chief Executive Officer Fredy Bush said in a statement that the company has complied fully "with all disclosure and due diligence processes required in the United States (and has) engaged the most qualified independent advisers available to oversee this process."

Xinhua Finance portrayed itself in its IPO road show "as a News Corp. of China," said James Lee, an analyst at W.R. Hambrecht, referring to Rupert Murdoch's media conglomerate. "They have operations in TV, radio and print. Their targeted demographic is high-net-worth consumers in China. Their starting point is offering financial content because that's what this demographic cares about."

Lee said he could not comment on the allegations about Xinhua's failure to disclose pertinent information in its prospectus because Hambrecht underwrote the IPO.

The Chinese government owns a small stake in Xinhua Finance, but the company is not affiliated with Xinhua News Agency, the official press agency of the Chinese government.

Two law firms have filed shareholder suits accusing Xinhua Finance and its underwriters of misrepresenting the company in its IPO.

Xinhua's share price has fallen precipitously from its IPO premiere of $13. On Tuesday it closed at $7.10, down $1.66 or 18.95 percent.

The California Public Employees' Retirement System, the nation's largest public pension fund, said the brouhaha would not affect its relationship with Glass Lewis.

"We are a subscriber to the service that Glass Lewis provides and we're satisfied with the service they're providing us," said Pat Macht, a CalPERS spokeswoman.